Value & Opportunity 2022 Performance Review & 2023 Outlook

2022 overview

2022 was a in absolute terms pretty bad, in relative terms however very lucky. The Value & Opportunity portfolio lost  -3,9 % (including dividends, no taxes, AOC fund as of 30.09.) against -16,7% for the Benchmark (Eurostoxx50(25%), Eurostoxx small 200 (25%), DAX (30%), MDAX (20%), all performance indices including Dividends).

Links to previous Performance reviews can be found on the Performance Page of the blog. Some other funds that I follow have performed as follows in 2020:

Partners Fund TGV: -33,6% (30.12.) 
Profitlich/Schmidlin: -19,2% (30.12.)
Squad European Convictions -14,1% (30.12.)
Ennismore European Smaller Cos (30.12.) +3,8% (in EUR)
Frankfurter Aktienfonds für Stiftungen (30.12.) -17,3%
Greiff Special Situation (30.12.) -3,5%
Squad Aguja Special Situation (30.12.) -19,2%
Paladin One (30.12.) -19,1%

Most of the “Long only funds” in the peer Group were clustered together near the benchmark in a tight range of -14% to -19%. The only positive peer was Ennismore, which is a long/short funds.

TGV Partners, which is part of the portfolio, was the weakest fund this year after being the best funds last year. In any case, a one year performance is only a snapshot, much more important are long term track records.

Over the 12 years from 12/31/2010 to 12/31/2022, the portfolio gained +336% against +120% for the Benchmark (Eurostoxx50(25%), Eurostoxx small 200 (25%), DAX (30%), MDAX (20%), all performance indices including Dividends).. In CAGR numbers this translates into 13,1% p.a. for the portfolio vs. 6,8% p.a. for the Benchmark. As a graph this looks as follows:

V&O perf 12 Jahre

Current portfolio / Portfolio transactions

New positions:

In 2022, portfolio activity was quite busy as already mentioned in the 23 Investments for 2023 post. New positions were: Nabaltec, Solar, DCC, Royal Unibrew, Gaztransport, ABO Wind, Rockwool, Sto SE and Recticel.

In and out in 2022 went 7C Solarparken, Energiekontor, PNE Wind, Belimo, Steico, Va-q-tec, Kingspan, Exmar and 3U Holdings. With the exception of Exmar and 3U (special situations), the others were part of “basket trades” that by nature are more short term oriented.

Sold positions

In 2022, I sold ABB, Euronext, NKT, Nexans, FBD, Richemont, Washtec, Zur Rose, Naked Wines, Play Magnus and Aker Horizons. The current portfolio per 31.12.2022 can be seen as always on the portfolio page. 

Some Portfolio statistics

The weighted holding period as of 31.12.2022 has been 3,7 years and is within my target of 3-5 years. The 10 largest positions account for around 56% (53%) of the portfolio, the largest 20 for around 87% (82%).

Allocation by country (ex Funds):

In % of Portfolio
FR 21,6%
DE 17,1%
SW 12.4%
DK 10,4%
UK 5,6%
IE 4,6%
CA 4,4%
NO 3,8%
SE 1,2%

Allocation by currency(ex funds):

In % of Portfolio
EUR 39.2%
CHF 12,4%
DKK 10,4%
GBP 10,2
CAD 4,4%
NOK 3.8%
SEK 1,3%

From a country / currency perspective, this is clearly a European portfolio, within Europe it looks relatively diversified.

“Active share” vs “do nothing”

The “Do nothing” approach, i.e. just letting the Portfolio run from 31.12.2021 and collect dividends would have only resulted in a performance of -10,6%, so my “active contribution” in 2022 was again quite good.

The main reason for this were were new or temporary positions such as Exmar, Gaztransport and especially the “Freedom Energy” basket which added around 200-300 bps. Also an early exit from Zur Rose and Washtec explain part of the difference. This is now the second year in a row where the “active share” was very significant.

So at least for me, being active in my portfolio seems to add value that offsets the tax impact I have at a personal level compared to “do nothing”. However I don’t expect thtis to continue to such an extent.

Monthly Performance 2022

Monthly 2022 table

As in the past, the relative outperformance was mostly made in months when the Benchmark did not do well. The portfolio looks less volatile as the benchmark. Part of this is the average cash allocation of around 10%, but also a timelag between the more liquid benchmarks and the generally less liquid stocks that I own.

For instance both, in August and December, it took some time until my portfolio positions reacted on the good previous month in the indices.

Annual returns

Annual 2011-2022

The relative outperformance in 2022 was unsustainably high and a combination of a couple of lucky factors that I will discuss in the next paraghraphs. 2022 was the third negative year for both, the Benchmark as well as the portfolio. Interestingly, 2022 was the worst year since 2011 for the benchmark but only the 3rd worst for the portfolio.

Mistakes made in 2022

The biggest mistakes in 2022 was clearly to not sell or reduce Naked Wines earlier as outlined in a seperate “post mortem” post. Another mistake was not to follow upon my 2021 Performance review idea:

The only idea that I am contemplating is to buy “very far out of the money puts” on the “nothing will ever go wrong” stocks like Google, Microsoft or Apple. Because something might go wrong at some point in time.

What went well in 2022

As in 2021, I was able to add a couple of “decent companies at decent prices” that I can hopefully own for a couple of years, such as Nabaltec, Abo Wind, Royal Unibrew, Solar and DCC.

In addition, I was able to identify two very interesting special situations with Exmar and 3U. However, especially with regard to Exmar, I was very lucky with timing. Also the “Freedom Energy” baset worked well. Here I was lucky to have looked already at renewables before, so I could pull the trigger quickly.

Finally, I managed to remain more patient when a stock goes up, for example with Meier&Tobler, where I managed to hold on for a much longer time then I would have a couple of years ago.

What I have learned in 2022

My way of stock picking results in a portfolio that can do relatively well in most environments, but if fundamentals change, it really makes sense to look at these positions one by one and “weed out” those positions that really might suffer. As mentioned, I added a more structured half year review that I plan to do as well in 2023.

Both, with Zur Rose and Naked Wines I also learned that with more speculative stocks, it doesn’t pay off to wait for a turn around.

Outlook & Strategy 2023

If I look through my annual performance reviews, the outlook and strategy is almost always the same: Stay Cautiously optimistic and continue to do what I have been doing and try to improve gradually.

For 2023 I think it is important not to fall into the trap to think that some “Tech fallen Angels” are cheap because they have fallen by -80% or more. If history ( is any guide, many of these business will not survive in their current form. For those few who will turn out to be decent or even great businesses, it could take a long time until their share prices will recover.

Interestingly, a lot of today’s “growth investors” have never experienced a longer period of time where even very good stocks have been undervalued for some time. There still seems to be a lot of FOMO in the market and everyone is looking for the big 2023 bounce back in “growth stocks” when inflations goes down and the FED eases. There is clearly a chance that this will happen and we will see periods of rapidly rising prices for “shitcos” but overall, I think one should be very cautious with these fallen Angels.

For the current Tech Favorites, I see three major issues:

1.) The “Blue Ocean” period is over. For some years, especially all the big companies like Google, Amazon, Microsoft,Apple, Meta and Co. could grow along each other without stepping on each others toes. This is now over. Apple kicking Meta into the kneecap with privacy settings was most likely only the start, more of these conflicts are to be expected. To me, many areas (especially advertising and E-Commerce) look like Red Oceans.

2.) Regulation will continue to increase. With increasing regulation, the former high growing tech companies will look more and more like Utilities or TelCos. Assuming that behemoths like Microsoft, Google or Apple will grow at 20% rates for many years is unrealistic.

3.) Tech business is peoples business.
For many tech businesses, the “story” is extremely important to justify the valuation, so Management, who is telling the story can command high and sometimes extrem salaries. The same goes for their Tech guys as well as other important people like Product guys etc. To me, many tech business look pretty simlar to investment banking businesses or other people businesses where to employees are able to extract the majority of the value creation one way or the other. Investors ignored this as they thought that “stock based compensation” is not an expense, but I guess at least some of them have learned that leason and this problem will not go away.

My own focus will remain on Energy, Energy efficiency, Decarbonisation. Electrification etc.  as these are very long running trends. In addtion, I think looking into the hard hit sectors in Europe for instance in the chemical industry could make sense. As in the previous years, I do think it is essential to keep an open mind and look for opportunities when they arise. Some financial companies for instance could also see better times.

For the long term, the inrease in the risk free rate of at least 300 bps over the last year has clearly increased the expected long term nominal return on stocks. The big question of course is, how persistent inflation will be and how real returns will look like. A lot of market participants seem to be super excited that they will receive positive interest rates going forward, however in terms of “real returns” the situation for fixed income investors is worse then ever.

In the mid to long term, the only protection against inflation are “real assets” and especially shares in businesses that can pass on cost increases.

As a Final goodie, below you’ll find a link to a song from Jimmy Cliff that I find quite fitting for 2022:

The harder they come, the harder they fall, one and all.


  • I missed the story behind ZurRose. Looks like a meme stock.

  • “For the long term, the inrease in the risk free rate of at least 300 bps over the last year has clearly increased the expected long term nominal return on stocks.”

    Why should long-term nominal returns be higher from higher interest rates? I do not get the direct relationship?

    • Long term expected nominal returns of stocks are usually considered to be the sum of the risk free rate and a relatively constant Equity risk premium. This however only applies for the long term (10 years or more). Not for next year or the next 2-3 years.

      • n terms of “real returns” the situation not only for fixed income investors but also for equities investors is worse than ever. Based on my calculations indeed, a rational equities investor, given an EU inflation rate of 10.4% and an ERP of 5.94%, should invest on the stock market only if he expects an annual nominal return of 16.95% for the long term to reach the targeted ERP in real terms and zero risk free rate in real terms.

        • 2 remarks here:
          1) I don’t think that inlfation will stay at 10,4%
          2) A stock is a “real” Asset, ie. companies have pricing power etc. Even in Hyoerinflation countries, stocks manage to create “real” return above inflation. So yes, I do think that nominal returns for stocks will be higher than inflation going forward.

  • Hello MMI,

    congratulations on another year of outperformance.
    What I have noticed over the last years, despite your commentaries on big events like covid and war in Ukraine, is your very stoic approach regarding macro data. I myself do quite often take general market valuations into consideration (how “crazy is Mr. Market currently?”), but this seems to affect you very little.
    Spending too much time on macro is clearly a waste of resources, however, as a partial business-owner I would think that taking rising interest-rates or a negative wealth-effect in large economies would play a large role in how these companies can perform. However, at least for now, these macro factors seem to be only reflected in how companies are valued (PEs) and highly leveraged companies are not valued a lot lower than their less leveraged peers (in general).
    The recent memo from Howard Marks was quite remarkable in that sense, hinting at more credit-defaults in the future. However, looking at your performance over the years, it would probably make sense to ignore such warnings as macro-noise and focus on micro and finding and investing in good companies. Maybe you would like to comment.
    Thanks for sharing your work in such an informative way!

    p.s. On a reggae-note I am glad your market comment was a Jimmy Cliff song and not Peter Tosh “The Day the Dollar die”


    • Oskarr, thanks for the comment. The problem for me is that analyzing macro data and acting on it does not improve my investment process. You not only need to come to the right conclusions, but you also need to judge how much of this is priced in or not.
      As I normally focus on very solid companies with good management, I guess these guys are solving a lot of these problems for me in their companies day by day.
      However I do pay significant attention to fundamental sector developments.

  • Congratulations to your results and many thanks for sharing your ideas!

  • Please continue your good work. I ’stole‘ several of my investment ideas from you during the last years…excellent ones ( ACT, ROCKWOOL), crazy ones (Zur Rose), bad ones (JET) and ’still to be seen‘-ones (DCC).
    I very much appreciate your good ideal and your disciplined approach.
    And the long term success of your Portfolio proves you right.
    So, cheers and really looking forward to your next ideas.

  • Hi MMI,

    congrats to your result. Looking forward to your next findings.

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